US DOT Fines Air Canada for Violating Price Advertising Rules

The U.S. Department of Transportation (DOT) today fined Air Canada $50,000 for violating the Department’s rules prohibiting deceptive price advertising in air travel.

“When passengers buy an airline ticket, they have a right to know how much they will have to pay,” said U.S. Transportation Secretary Ray LaHood. “We take our airline price advertising rules seriously and will take enforcement action when they are violated.”

The Department’s Aviation Enforcement Office found that Air Canada, for a period of time in early 2011, displayed advertisements on its websites that did not disclose the amount of taxes and fees that passengers would have to pay in addition to the advertised fare or lead the consumer directly to the information on these taxes and fees. Consumers clicking on the ads were taken to a page on Air Canada’s website where a list of routes and prices were displayed, but consumers could not find details of the additional taxes and fees unless they scrolled to the bottom of the page where the information was shown in fine print.

Air Canada’s advertisements violated DOT rules requiring any advertising that includes a price for air transportation to state the full price to be paid by the consumer, including all carrier-imposed surcharges. The only exception currently allowed is government-imposed taxes and fees that are assessed on a per-passenger basis, such as passenger facility charges, which may be stated separately from the advertised fare but must be clearly disclosed in the advertisement so that passengers can easily determine the full price they must pay. These rules apply to both U.S. and foreign carriers.

Under DOT’s recently adopted consumer rule that enhances protections for air travelers, carriers will be required, among other things, to include all government taxes and fees in advertised fares beginning Jan. 24, 2012.

The consent order it available on the Internet at www.regulations.gov, docket DOT-OST-2011-0003.